Increased expansion of Kenyan banks to the East African region is expected in the year which would possibly lead to increased performance, according to Oxford Business Group.
At the start of 2018, nine Kenyan lenders operated a total of 306 subsidiaries in EAC up from 297 a year earlier.
Equity Bank led in the region with 104 locations in five countries. Diamond Trust Bank (DTB) operated 70 branches in three countries, while KCB group had 60 branches in five member states.
According to the report, this was pushed by Nairobi’s status as an advanced financial centre, helping some of larger banks establish a successful presence in regional markets.
Uganda still remained the home of highest number of branches, accounting for 102 locations, followed by Tanzania (81) and Rwanda (55).
“Of course the expansion trend will continue in 2019 due to interrogation for investment in the region,” Kenya Bankers Association chief executive Habil Olaka said.
The vision is set despite a rough operating environment in Tanzania and Uganda that saw a 1.01 per cent decline in profit generated from subsidiaries to Sh8.79 billion in profits in 2017, compared down from the Sh8.88 billion in 2016.
The spread of operations to the region is one the market changes that banks have taken for growth away from the challenges posed by interest rate framework.
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